Washington County sues Passamaquoddy tribe over tax claim

MACHIAS, Maine — Washington County has filed suit against the Passamaquoddy nation, seeking recovery of payments in lieu of taxes dating to 2006.

While no dollar amount is specified in the lawsuit now pending in federal court, an attorney for the tribe said Thursday that the county is seeking about $40,000.

The suit claims that Washington County is authorized to collect payments in lieu of taxes, also known as PILOTs, under terms of the Maine Indian Claims Settlement Act of 1980 based on all real estate and personal property of the Passamaquoddy in Washington County.

“PILOTs are not defined in dollar amount,” the suit states, “but rather are to be in an amount equal to that which would otherwise be imposed by a county, a district, a state or other taxing authority.”

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According to Portland attorney Craig Francis, who represents the Passamaquoddy, the tribe has agreed to negotiate a settlement but has received no response from Washington County officials.

“It’s very odd for the county to be suing the tribe,” Francis said. “I think with the economy being as tight as it is, they are looking for money anywhere they can find it. Instead of a flat-out tax, they’re now calling this a payment due.”

Typically payments in lieu of taxes are made on a voluntary basis by nonprofit organizations that are not legally obligated to pay property taxes. One example is The Jackson Laboratory in Bar Harbor, a nonprofit genetics research facility that owns land and buildings assessed at more than $150 million.

If the lab was not a nonprofit organization, its annual property tax bill would exceed $1.4 million. Instead, Jackson Lab which last year had a surplus of more than $30 million, made a voluntary annual PILOT contribution of $72,785 to help share the cost of fire protection and other municipal services provided by Bar Harbor.

Two attorneys representing Washington County declined comment on the lawsuit, as did Washington County Manager Betsy Fitzgerald.

Penobscot County Administrator Bill Collins said Thursday that the Penobscot Nation is sent an annual tax bill and that in 2012 the tribe paid $10,128, not as a PILOT payment, Collins said, but as the tribe’s share of county taxes.